Contracting for Energy Crops: Effect of Risk Preferences and Land Quality

摘要: This paper analyzes the effect of landowner risk preferences and land quality on optimal mix vertically integrated production contracted an energy crop in a region characterized by heterogeneity landowners’ with riskiness returns from both conventional production. We examine determinants decision landowners to grow for biofuel under one three types contracts, leasing contract, fixed price contract revenue sharing impact time preferences, prices terms effective cost biomass. find that as degree aversion rate preference increases producing increases, share crops increases. While low is more likely be converted production, increase results threshold level but decrease contract. also refinery can potentially earn higher profit offering menu different contracts rather than single type only; allowing self-selection based their premium needed induce reduced.